Hacker News Reader

Comment by _ink_ | Hacker News Reader

But who will take over world reserve currency status?

World reserve currency was solved by Keynes and Joan Robinson in the 1940s. What you do is have a currency no country controls that acts purely for exchanging one national currency for another. Give it to the united nations or something.

If you take a national currency and make it a world reserve currency then the nation that does do has problems with balance of trade, deficits, and mathematically screws themselves over. This is because you currency becomes overvalued compared to those of over countries, meaning your domestic manufacturing has problems competing, among other things.

We already made the mistake of one national currency becoming the world currency post WW2. I hope its not a mistake the world chooses to repeat.

This is what cryptocurrencies do, but remove the need for an intermediary and codify the rules in software, so it is much harder (near impossible?) for politicians to manipulate the money supply.

Why would there have to be a world reserve currency?

Seems to me a basket of Euros, Yen and MAYBE US dollars is better than relying on the USD.

It will likely be a cryptocurrency or perhaps a basket of cryptocurrencies. You essentially want a way to store wealth directly on the Internet as it is the fastest and easiest way to reassign ownership of money or collateral. The nice benefit too, then is the U.S. (and no other country as well) is subject to the Triffin Dilemma.

crypto is a solution in search of a problem.

cryptocurrencies solved the double-spend problem for digital currencies. There is no ongoing search.

https://en.wikipedia.org/wiki/Double-spending

Which was never really a problem before cryptocurrencies. Nor does it any way address the core issue we have with physical currency, taking out loans now, against future wealth generation, which is happening in the crypto space too.

Incorrect. It's always been a problem. Go back and look what has happened to the purchasing power of the dollar throughout the 1900s. If the dollar is losing purchasing power you can hedge that loss by buying Gold, commodities or cryptocurrencies. (Basically anything scarce) Also, there are no loans being taken out against the future wealth generation in crypto. That is entirely a fiat phenomenon. Call your Senator.

Reply on news.ycombinator.com